Nearly half a million Britons are at risk of missing the deadline to file a Self Assessment tax return, according to a new survey. Research carried out by Handelsbanken Wealth & Asset Management found a growing number of self-employed workers are struggling to complete their tax obligations before the deadline on January 31.
As of January 23, HM Revenue and Customs (HMRC) reported that around 3.8 million people were yet to file their returns for the 2022/23 tax year. Those who do not file on time face a £100 initial penalty with around 475,000 telling the wealth management firm they have missed the deadline in the past.
There is only one day left to file before the deadline on January 31
Some 22 per cent of those polled said they are anxious about the financial consequences of making a mistake when filing, or the financial repercussions of missing the deadline.
In the survey of self-employed taxpayers, 10 per cent cited that completing Self Assessment returns can be challenging due to their lack of financial knowledge.
On top of this, one in 12 respondents described filing as “tough” because calculating income can be difficult when working for oneself.
Based on the research, men aged between 25 and 34 are most likely to miss the deadline and be hit with a penalty with 16 per cent admitting they are likely to file late.
In recent years, more Britons have become self-employed due to the changing jobs market which means they must file a Self Assessment form.
While 54 per cent of taxpayers described themselves as PAYE employees with no extra income, around 6.1 million people have some level of self-employed income.
Around a quarter of adult Britons aged 18 to 34 are in the latter category compared to only nine per cent of Britons aged either 55 or older.
This means the demographic most reliant on self-employed income are most likely to make a Self Assessment tax error.
Self-employed taxpayers need to file on time or face a £100 fine
Mark Collins, the head of Tax at Handelsbanken Wealth & Asset Management said: “Self-assessment returns are clearly challenging for substantial numbers of the self-employed, with many at risk of missing the January 31 deadline and others struggling to complete returns.
“HMRC says that those with a reasonable excuse for missing the deadline may avoid penalties, but there is the risk of a £100 fine even if there is no tax to pay, and penalties can mount up if returns are more than three months late, with additional penalties for paying outstanding tax late.”
Those concerned about making the deadline can go onto the http://GOV.UK website to discuss their options with HMRC and potentially arrange another payment plan.
The deadline to file a Self Assessment tax return for the 2022/23 tax year is January 31, 2024.